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This is What "Consensus" Looks Like

January 15, 2009

If there were ever a topic over which state governments were certain to reach universal agreement, it would be whether the federal government, and specifically the executive branch, has the unfettered right to “preempt” their laws.

Yet, despite conservatives’ purported respect for the states and federalism, for eight years the Bush Administration has aggressively fought to uphold federal preemption of a wide range of state laws, including environmental regulations, consumer safety protections, antitrust laws, and others.

With a new administration about to take office, the states are hoping for a change. Earlier this week, in a briefing paper sent to the Obama transition team by the National Association of Attorneys General, the AGs of all 50 states, 5 U.S. territories, and the District of Columbia strongly urged the Obama Administration to reverse this trend, calling “resistance to federal preemption” their No. 1 priority for the incoming administration.

Specifically, the AGs reaffirmed their complaint that the federal government’s position on preemption helped cause the home foreclosure crisis that led to the current recession (a point articulated by then-New York Governor and former AG Eliot Spitzer a year ago). From the AGs’ briefing paper:

Preemption of state regulation by federal administrative agencies lead to irresponsible lending and contributed significantly to the ongoing mortgage and credit disasters at the heart of the recent financial crisis. In the current, failing economy, with housing prices plunging and the number of foreclosures soaring, it is critical that state Attorneys General continue to be “56 cops on the beat,” and be given the necessary regulatory authority to impose appropriate standards on lending institutions.

These statements refer to years of frustration among state AGs, whose efforts to investigate and regulate predatory lenders have been aggressively blocked by the Bush Administration. In addition to calling publicly on the executive to reverse this position, state AGs also filed amicus briefs in two related Supreme Court cases this term asking the Court to resist preemption, and testified before Congress on the need to preserve and uphold state regulatory authority.

In its zeal to further corporate interests (often to the detriment of ordinary Americans), the Bush Administration’s position on preemption ran contrary to the text and history of the Constitution. The Framers created a system of dual-governance in which the federal and state governments share regulatory authority. CAC advocates this same vision of federalism, which ensures states can act as the laboratories of democracy, while also allowing the federal government to address problems states cannot fully address alone (see here to learn more).

Let’s hope that the Obama Administration shows more respect for the vibrant federalism established by our Constitution and supported by the state AGs, not to mention Americans who desperately need the economic, environmental, and other protections offered by the states.